OGC claims e-auction success

50% savings for councils and NHS trusts

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The Office of Government Commerce (OGC) has reported that a group of councils and NHS trusts saved almost 50 per cent of the previous cost of IT hardware in an electronic auction.

The 14 local authorities and six health trusts spent £6.9m on six lots benchmarked at £13.7m in an auction taking place on 10 May.

It was the biggest saving achieved so far since the first e-auction in September 2005, and according to the OGC's estimates brought the total of savings to £21m, it said on 14 May 2007.

The e-auction was run by the OGC with the London Centre of Excellence, the regional centre for delivering local government efficiency. The baseline figure was determined by the relevant volumes against prices the organisations have been paying.

The OGC said nine suppliers out of 18 invited took part in the e-auction. Four of them won a share of the business.

Rob Leak, chief executive of LB Enfield, one of the participating councils, said: "We are delighted with the results achieved through this e-auction as it gives us a tangible cashable saving and proves that collaborative working delivers results. I am eager that the collaborative approach extends to other high value commodities and services highlighted by the LCE, as I am sure that there are even more savings to be exploited across London by working together and influencing markets."

Chris Chettle, OGC e-auction manager, said: "The e-auction has delivered an extremely competitive deal, demonstrating the huge benefits that can be obtained by working collaboratively to engage with suppliers. These councils and NHS trusts have together achieved far greater price reductions than anything they would have obtained by each negotiating with the suppliers on an individual basis."